Saudi Aramco exits Vietnam JV; PTT relays project to IRPC

SINGAPORE (ICIS)–State-owned oil and gas company Saudi Aramco has decided to withdraw from the development of a joint venture refinery and petrochemical complex in Vietnam with PTT, a source from the Thai energy firm said on Friday.

PTT, in turn, will be transferring the project to its 38.5%-owned affiliate IRPC, the source said.

In 2014, PTT and Saudi Aramco had jointly submitted a detailed feasibility study for the $22bn world-scale fully integrated refining and petrochemical complex, called Victory project, in Binh Dinh province to the Vietnamese government.

The two companies were planning to have an equal stake of 40% each in the Vietnam project, which will be able to process 400,000 bbl/day of crude oil.

The Victory project is also expected to produce 260,000 bbl/day, or 12m tonnes/year, of refined products and around 5m tonnes/year of petrochemical products, including olefins and aromatics.

“Saudi Aramco has decided to withdraw from further development of Victory project with effective date of July 1, 2016,” the PTT source said.

The Saudi Arabian energy firm could not be reached for comment at the time of writing.

“PTT and Saudi Aramco have sought for a capable Vietnamese company to be a partner of the project but it has not been successful so far,” the PTT source said, explaining the withdrawal of the main proponents of the project.

PTT still views Vietnam as a strategic location for investment and will continue to develop the project by transferring it to IRPC, the source said.

IRPC is the first fully integrated petrochemical complex in southeast Asia, according to its website. The company’s operations are located in Thailand’s Rayong province, where it has a 215,000 bbl/day refinery and a 350,000 tonne/year naphtha cracker, and a host of downstream units.

Its petroleum products include refined oil, lube base oil, naphtha, long residue (heavy oil) and asphalt. The company also produces olefins, aromatics, polymers and polyols, according to its website.

“As a shareholder, PTT will support IRPC’s decisions on this project such as project size, scope of investment, potential partner,” the PTT source said.

Top image: Oil worker offshore, Vietnam 2005 (Photographer: Simon Townsley/REX/Shutterstock)